Comment Text:
Dear Chairman and Commissioners,
My name is Isaac Palakunnel, and I'm a college student at the University of Houston in Texas. I'm writing to share my thoughts on the Advance Notice of Proposed Rulemaking on Prediction Markets (91 FR 12516). As an everyday citizen, I've found prediction markets to be incredibly useful, and I strongly support regulating them in a fair and proportionate way rather than banning or over-restricting them.
I started using prediction markets to help manage financial risks as a student. Money has always been tight for me, to the point where I used to struggle to afford meals every day. Using my deep knowledge of the NBA, Ive put together detailed spreadsheets and used advanced analysis to trade on these markets. That extra money has been a lifeline, helping me cover basic needs. This isn't gambling to me. It takes real research and judgment, just like investing in stocks. Classifying event contracts as "gaming" (as discussed in Questions 15-22) ignores their legitimate economic purpose. Theyre a tool for people like me to hedge risks and make informed decisions.
Beyond my personal story, I believe prediction markets benefit society. They consistently produce more accurate forecasts than polls or pundits, especially for elections and public events. That information helps everyone, not just traders, by improving price discovery and aiding decision-making (relevant to Questions 7-14 on public interest). I've read about academic research showing how these markets aggregate information efficiently, and I think thats something the CFTC should value. Also, letting regular people participate democratizes access to this information. If only big institutions can trade, the insights stay with them, which isnt fair.
Im aware of concerns about manipulation or insider trading (Questions 29-32), but the CFTC already has strong tools to address those issues. Banning entire markets to stop a few bad actors punishes the wrong people. Plus, informed trading often improves price accuracy, benefiting all participants. Over-restricting these markets would just push activity to unregulated offshore platforms, which are far less safe than regulated ones like Kalshi. Id rather see the US lead in financial innovation than cede that ground to other countries.
As a student, I also use prediction markets to hedge personal risks, like potential policy changes from elections that could affect my loans or part-time job. Theyre practical tools for managing uncertainty, not games. I urge you to focus on targeted, proportionate rules that address specific risks without broad bans (as raised in Questions 23-28 on procedural aspects). Regulation should protect consumers while keeping these markets accessible.
Thank you for considering my perspective. I ask that the CFTC support well-regulated prediction markets and avoid overly restrictive policies that could harm their potential.
Sincerely,
Isaac Palakunnel
